Posted on 08/24/2015 6:04:06 AM PDT by SeekAndFind
Last month I bought a house in Potomac, Md., a trade up on my current home, and was shocked to learn in the ensuing weeks that I couldn’t get a mortgage loan. First, I went to PNC bank. Then Wells Fargo. Then another. Denied. Denied. Denied.
No, I don’t feel entitled to a loan, and the banks have every right not to lend me money. But my tale of woe tells a broader tale of what is going on in the lending industry these days.
All the bankers told me the same thing: “Steve, if you’d walked in our bank eight years ago with this mortgage application, we would have rubber stamped it in five minutes and you would have walked out with a bag of money.” But those were the go-go days of the real estate frenzy when people who worked at McDonald’s could walk into a Countrywide and get a $600,000 mortgage. Back then underwriting standards were tossed out the window.
Now, thanks in part to new federal regulations like Dodd Frank with its anti-predatory lending rules, the pendulum has swung to the other extreme and underwriting standards (for those without federal insurance) are absurdly tight. Here we are with the lowest interest rates in 50 years, but many businesses and aspiring homeowners can’t qualify. Water, water everywhere and not a drop to drink.
My situation was doubly frustrating because I’m making a 25 percent down payment on the house. Researchers have examined huge samples of the portfolio of defaulted loans during the 2007-09 housing crisis. Virtually all of the defaulted loans had a low down payment with many less than 5 percent down thanks to government “affordable housing” mandates.
(Excerpt) Read more at washingtontimes.com ...
Is this the “Club for Growth” guy?
Mine's right around 800 and I haven't paid a dime of interest on my credit cards in 20 years because the balance is paid in full every month. I've paid interest on my student loan.
You can't really separate paying back the loan and the banks making money from you. They go hand-in-hand if you reliably pay your bill on a loan.
I got Ad Block Plus installed on my Firefox - it kills the ads and I can actually read the sites now.
Yeah. He should’ve kept this incident to himself to protect his reputation as someone who supposedly is an expert on financial matters.
Always, always, always, always... GET A LETTER OF CREDIT BEFORE LOOKING FOR A HOUSE!
-PJ
We refinanced our house a couple months ago and got a 3 percent note. I had to sign my name 55 times on documents to complete the deal.
Use Ad block plus, it takes the Times and Breitbart.
A $600k mortgage would cost the borrower less than $3000 per month
Not sure how that cripples someone earning $10,000 per month gross.
Perhaps you should have?
This was infuriating on several levels. First, I have had two previous mortgages and in 25 years I’ve never missed a payment. How can I be a high-risk borrower? The answer is twice in 30 years I was 30 days late paying my credit card bill — and paid the hefty late fee. Even more ridiculous, I, Steve Moore, have $300 of unpaid parking tickets. The horror.
Something similar happened to me a few years back for similar reasons on a 60% equity loan. I could have paid off the mortgage with savings held in the same credit union, but tried a refi instead for ~3%. Loan wouldn’t go through because of gov’t underwriting standards.
***But those were the go-go days of the real estate frenzy***
It has happened before, once back in the Jimmah Carter fiasco and through the 1980s when interest rates went through the roof, and every mortagage company was encouraging homeowners to refinance and SPEND SPEND SPEND the equity they got out of their homes! Then came the real estate crash.
Then again in the pre-Obama years when mortgage lenders were encouraging people to BUY BUY BUY overpriced homes on beer budgets, even lending more than the house was priced at.
I told my wife.. “Hide and watch! It will all collapse soon!” And it did!
We held pat and were in OK financial shape. That is, until I saw this morning’s stock markets crash! Now I am taking diction lessons to say... “Welcome to Walmart!”
If you’re using Mozilla Firefox . . there is a little icon in the URL that looks like an open book. Click it and it will take you to an ad-free page that makes reading and copying much easier. No ads pop up at all. I love it.
> First answer to the headline -
because you forgot to check one of the “minority” boxes on the application, dummass!
I honestly thought about checking “African American’ on a loan application recently. I thought hey if Shaun King and Rachel Dolezal can do it, why can’t I?
I think that he is not telling the whole story or he just made it up to have a story to tell for a column.
It doesn’t make a lot of sense.
“The answer is twice in 30 years I was 30 days late paying my credit card bill — and paid the hefty late fee. Even more ridiculous, I, Steve Moore, have $300 of unpaid parking tickets.”
Steve Moore isn’t telling the whole story. Those late bills were probably within the last couple of years and were more than 30 days late. Steve should have looked at his credit prior to shopping for a house.
If anyone challenges you, call them a racist and they’ll have to shut up - those are the rules they set up.
Questions from reading the article:
Where, exactly did his 25% down payment come from? Was any of it a gift or a loan?
Why is his credit score low, and what is it, precisely?
Why does he have $300.00 in unpaid parking tickets? Why aren’t they paid?
What are his other debts and obligatons?
Yet if he were black he would get the loan immediately.
I just got a six-figure HELOC on my primary residence, and the underwriting process was like the DMV on steroids. It took 140+ days despite stellar appraisals, credit score, and income. By the time it came through, I was ready to just walk away. It was truly horrible customer service.
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